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Divorce Financial Settlement

What is a Divorce Financial Settlement?

A divorce financial settlement is the agreement or order directing how assets and debts are to be divided between the parties in a divorce. As such, it is part of the larger divorce settlement agreement. Most divorce financial settlements will involve dividing the entire estate equally 50/50; however, there are certain times when it is more equitable to have one spouse receive more assets or less debt depending on childcare, current salaries, and other factors. Generally, being informed and having open communication with your soon to be Ex will lessen the tension and hopefully lead to an amicable settlement across the board.

However, reaching an agreement can be complicated, with hundreds of questions about attorneys, consultation, and the tornado of paperwork that separating brings. How do you ensure that your financial settlement benefits you? How do you know that your lawyer is really working in your best interests? With all of these concerns, it’s no wonder why Psychology Today links divorce stress to physical health problems.

As a woman, your primary focus should be ensuring that you achieve the best business transaction for you–that you and your children are set up for healthy living after the split. To that end, here are some answers and general advice about how best to go about a divorce financial settlement.

Should You Settle Before or After the Parenting Agreement?

Ideally, it is best to figure out your budget first, parenting time second, and then settle the financial agreement third. To do this, sit down with a financial advisor and outline your monthly budget to determine what you need to make sure you can live as comfortably as possible. Understand that you will have to compromise. Most likely, you will not have the same standard of living you experienced while married. At the very least, you’ll need to make sure you have enough to cover your bills and essentials.

From there, calculate how much it would cost to clothe, feed, and house each of your children. You will need to factor in how much you will be receiving or paying in child support.

When determining your budget, remember to factor in hidden costs. Ask your financial advisor about inflation and taxes to make sure every expense is accounted for.

Answering these questions first will make it much easier when discussing the parenting agreement or the financial agreement. By having all your answers ready ahead of time, you will be prepared for every question thrown at you. It will also ensure you are not agreeing to things that may cost you more down the road.

How to Make Sure Your Divorce Financial Settlement is in Your Interest

It can be hard to divide finances evenly when there is an obvious bias between you and your Ex. Maybe you’re a Stay-at-Home-Mom or the primary breadwinner in your marriage. Hiring an attorney to negotiate helps ensure you get what is rightfully owed to you, or that you are not overpaying.

You need to be honest about everything financial. Armed with the budget you outlined before, be prepared to express your needs and be open about what you can compromise on. Sharing this with your lawyer will help you and your lawyer to come to the table with all the facts laid out; this is the best way to ensure you have financial security after the separation.

If you are concerned your partner is not telling the truth about their finances (he* wouldn’t be the first!) then a divorce lawyer can help. Leave the investigating to them. You need to focus on yourself and your needs right now.

When offered a document, it’s important to remember this rule of thumb as your creed: you will have to compromise. If it sounds like you are not compromising, then it is too good to be true.

Whom to Consult Before Submitting A Settlement to the Other Side

After consulting with the financial advisor to determine your budget, you need to sit down with a divorce lawyer to figure out your best course of action. Make sure to bring your budget calculations, tax returns, pay stubs, any prenuptial or separation agreements.

If you have any other legal documentation involving your children or Ex, such as a court case, bring that paperwork too. Your lawyer needs all the information they can get.

Once you bring everything to your lawyer, you need to see what exactly your lawyer can do for you. Their job is not to punish your Ex or go for revenge: they are advocating for you. You want a lawyer who is competent and experienced at their job, and you can ensure this by how they answer the following questions:

  • How many divorce cases have you handled?
  • How did you handle those divorce cases?
  • What is your fee structure?
  • What is the best method of communicating in the future?

If your lawyer stumbles, stutters, or does not have an answer to these questions, you may want to consult other legal counsel. (For more savvy questions to ask a divorce attorney, visit here.)

Divorce Financial Settlement Must-Knows

Just like how you have questions you need to ask your lawyer, you also have questions you need to ask yourself.

  • What do you own? See if you are listed as the owner of your car, home, and other assets. Noting what you brought into the marriage could keep your Ex from claiming it.
  • What do they own? If your spouse is eligible for social security benefits, insurance payouts, or a pension plan, you may have a claim to them.
  • What do you both own? You need to factor any jointly owned assets into the final agreement. Dividing 50/50 does not always mean fair.
  • What about taxes? If you have to choose one government agency not to mess with, choose the IRS. Consulting a tax accountant will save you lots of money.

Above all, try to be as objective as possible. This is an emotional time, but money does not cry. Finding a safe space for your emotional outlet (a therapist, a coach) will honor your heart and feelings while your brain must focus on the best business transaction for you. Encouraging your brain to stick to the facts will ensure that you come out the other side prepared for the single life.

Notes

Jeanette Soltys is a Partner and Divorce Attorney at Atlanta Divorce Law Group in Alpharetta, Georgia. A passion for wanting to help children and families seeking their happily ever after led her to pursue her Juris Doctorate from Wake Forest University School of Law. Visit Jeanette Soltys’ website to learn more about her, her law firm, and the services her team offers to families.

Since 2012, SAS for Women is entirely dedicated to the unexpected challenges women face while considering a divorce and navigating the divorce experience and its confusing aftermath. SAS offers women six FREE months of email coaching, action plans, checklists and support strategies for you, and your future. Join our tribe and stay connected.

*At SAS, we support same-sex marriages. For the sake of simplicity, however, we may refer to your spouse as “he” or “husband.”

Tips for Amicable Divorce

Top 6 Tips for an Amicable Divorce

In the minds of many people, divorce and court trials are inseparable like smoke and fire. A few decades ago, this was the case. Fortunately, there are other options nowadays, namely an amicable divorce, where married couples don’t have to wage war against each other in court.

After the adoption of the no-fault divorce law in 1970, the divorce rate skyrocketed. A 2019 University of Virginia research report revealed approximately 3 divorces per 1,000 married women in the 1960s. In the 70s, this figure rose to 4.5, and 5.5 in the 80s.

These results suggest that divorce was increasingly viewed as a viable option for women; they were feeling more empowered, making more money, and feeling like they had more choices.  In the latter scenario, these divorces can likely be uncontested or amicable.

What is an amicable divorce?

An amicable divorce is not about being best friends with your (soon-to-be) Ex and liking each other. You wouldn’t consider divorce in the first place if your relationship was a loving one.

In the context of ending your marriage, “amicable” means “civilized.” It’s about resolving disputes in a nurturing and productive environment.

A peaceful divorce is actually not that hard to get to if both sides are willing to make an effort. You’ve probably heard of Conscious Uncoupling, for example, or divorce mediation, or Pro Se (DIY) divorces. To learn if one of these alternative processes is right for you, consider these six key steps to ensure a smooth and amicable process–and don’t forget to ask yourself: are you and your spouse capable of them?

1. Have an open mind for negotiation

Honesty and openness are the foundation of a successful negotiation. If one of the parties starts hiding valuable information, assets, income, etc., it’s not going to work. Agree from the very beginning to be truthful about all the aspects of your divorce. Otherwise, all your efforts will be pointless.

SAS note to women: It’s one thing to say you both will be honest, it’s another to know that you both will be. If your spouse has a record of deceiving, betraying or hiding things from you, go for a more traditional approach to divorce. Hire a lawyer who is a good negotiator on your behalf.

Naturally, in any divorce, neither of you will get precisely what you desire. Don’t expect your spouse to agree with everything you suggest just because you think it’s reasonable. Sometimes their point of view may differ from yours, and you’ll have to accept that.

During negotiations, the most vital thing is to stay focused on the key points that hold the most significant interest to both of you. How much money would you need to meet your needs after divorce adequately? Could your spouse (or you) afford to pay alimony (spousal support) and child support? You and your partner need to carefully approach all the details together and make a joint decision. That’s the essence of peaceful negotiations, right?

2. Focus on the desirable result.

Can you remember why you got married in the first place? You were in love and full of hope to walk hand in hand through life until death separates you. Unfortunately, not all of us can reach that distant goal.

Nothing has changed since then except that your goals are now different. Have you already determined what you really want from this divorce? If not, it’s high time to start figuring it out. But if you know where you’re heading, don’t let negative emotions lead you astray.

An amicable divorce is all about attitude. Reduce the tension to a minimum, and keep your eyes on your goal.

Take time to ponder over your life post-divorce. Do you see your Ex in it? After an amicable divorce, many couples remain friends and even sometimes spend time with their children as a family unit. You must agree that such a scenario is more pleasant than fighting endlessly over all sorts of things.

Act based on what is paramount to you and ignore everything else. Work through any disputes peacefully and make sure your communication is positive.

3. Treat each other with respect.

An uncontested divorce is only possible with mutual respect and politeness. Both you and your spouse are adults and can behave accordingly. It’s not as challenging as you might expect.

Start with getting into a positive state of mind and remain focused on keeping calm. Also, listen attentively to your spouse and contemplate their suggestions. Don’t let your emotions take over.

Whenever you feel like losing it to anger, take a deep breath and pause before saying or doing anything. Consider the consequences in the long run–will your current action improve the situation in any way? If not, give it up. Neither you nor your spouse will win if you keep insulting each other instead of resolving disputes.

Show civilized behavior. Don’t badmouth your partner in front of your children and relatives. And especially, don’t gossip about them on social media. You’ll only entertain the public and receive even more negative feelings back. Such actions also won’t help you to maintain an amicable divorce.

4. Think about your children’s needs.

Divorce affects everyone in your family, and especially children. They are very sensitive to any changes in mood and attitude between their parents. Remember yourself in childhood and what acute sensations of the surrounding world you had.

Now imagine how terrifying it is for a child to go through a family breakup. You don’t want to aggravate the situation even more by fighting with the other parent, do you? On the contrary, you want to protect your children and make them feel loved by both you and your ex.

Learn to trust yourself to be a good parent. The same goes for your partner. It’s time to loosen your grip and stop controlling everything and everyone around. Every good parent brings up their children with a position of love and a wish to make their lives happy. You will never be able to communicate well with your ex if you do not trust them with raising children.

And since we have touched on the issue of healthy communication, children need to see their parents find common ground and behave in a civilized manner whenever they meet. It can make a huge difference in a child’s emotional health.

5. Get an educational consultation with an attorney: don’t rush to hire one.

You cannot become your own divorce lawyer fast enough, despite what Google makes you believe. If you are thinking about divorce, and especially if you have children, assets, and/or debt, we encourage you to draw up your questions and consult with an attorney to hear what the law says about your circumstances. Do this before you commit to “how” you will divorce, or even, “if” you will divorce.

After you are informed about the law, you can decide if you will pursue DIY divorce, mediation, an online divorce, or a more traditional approach of you hiring an attorney and your spouse doing likewise.

Consulting with an attorney does not mean you are necessarily getting divorced. It also does not mean you are seeking to be adversarial or un-“amicable.” It means you as a woman are getting educated on your rights and what you are entitled to before you act.

It’s good practice to consult with other experts, too. For example, you may want to keep the house but need to learn if it’s really in your best financial interest. Consult with a financial advisor to learn the optimal longterm play for you (and don’t rely on an attorney for this.) You might consult with a parenting expert if you have concerns on what the best custody arrangement will be or how to support your kids through the divorce. Throughout the process, you might recognize that you are feeling overwhelmed and need to get strategic and healthy in your approach to all things “divorce”, in which case your best move is to schedule a free consult with a divorce coach.

The Legal Takeaway

Keep in mind that in divorce, you won’t always get what you want. The ability to find compromises is what makes a divorce amicable. On the bright side, you will be able to control the outcome by at least 50%. If you go to court, you will have to surrender to the will of the judge.

Do you trust absolute strangers to decide your fate, or do you prefer to do it yourself? Get informed, double check information, and choose wisely. It’s you and your children who will have to live with the consequences, not the lawyers and judges.

6. Forgive and forget.

You probably think, “How can I forget all those times when I was wronged during my marriage? And why should I? Now, I want justice.” Well, guess what? Such an attitude will bring you nothing but more suffering.

There are no winners in divorce. And you won’t feel any better if you keep blaming your marriage breakdown on your partner. Be wiser than that. Does a butterfly think about the time it was a caterpillar? No, it spreads its wings and flies. So, instead of focusing on your past and arguing over it, choose to take action to help yourself recover and move forward. 

Learn how to help yourself grieve the losses you experience, choose to live in the present, and plan for the upcoming future.

Is it worth the try?

An amicable divorce is a conscious choice. It can’t be involuntary, and it doesn’t work for everybody. You have to decide for yourself what type of separation you want and stick to it. Just keep in mind that no matter what method you choose, going down the hateful path only brings more negative feelings into your life. There is always a way to go about any situation productively. You can choose less stress and fewer expenses with a more positive experience by opting for an amicable process.

Jamie Kurtz is a divorce attorney and a member of the State Bar of California. She’s a co-founder of a law company helping people with uncontested divorces and a contributing writer for OnlineDivorce.com, a web-based service for divorce papers preparation.

Since 2012, SAS for Women is entirely dedicated to the unexpected challenges women face while considering a divorce and navigating the divorce experience and its confusing afterward. SAS offers women six FREE months of email coaching, action plans, checklists and support strategies for you, and your future. Join our tribe and stay connected.

Women must know about divorce in texas

6 Things a Woman Must Know About Divorce in Texas

Every state is unique in how it adjudicates divorce, adding to the headache of getting on with life-after-marriage. And the Lone Star state, as you might expect, has its own unique rule book. There are several things a woman must know about divorce in Texas if she is going to avoid painful surprises. We’re going to look at six of them.

From waiting periods to custody to the division of assets, it’s imperative that a woman goes into her divorce with eyes wide open. And, if that woman is you, the time to educate yourself and prepare is now.

Even if you’re still in the not-sure stage, there is a checklist of things to do if you are contemplating divorce. The fact that “the big D” is stirring around in your mind may be the shoulder-tap you need to work on your marriage.

But, if you are past the point of possible resolution, it’s time to bring your A-game. The more informed and prepared you are, the better you (and your children) will be going forward. So embrace the unembraceable with wisdom, dedicated research, and unflappable self-advocacy.

Let’s look at six important things a woman must know about divorce in Texas.

 

  1. Grounds for divorce. 

There are seven grounds (reasons) for divorce in Texas, but only the first one is considered “no-fault.” The remaining grounds can influence judgment regarding things like division of assets and child guardianship. (Obviously these grounds can apply to either or both spouses. And most couples opt for a no-fault divorce.)

    1. You have irreconcilable differences. “No one’s at fault, but we just can’t live together or get along anymore.”
    2. There is emotional and/or physical abuse (“cruel treatment”) that makes staying in the marriage unsafe and/or unbearable.
    3. Your spouse has cheated on you.
    4. Conviction of a felony. During the marriage, your spouse was convicted of a felony and incarcerated for at least a year without pardon.
    5. Your spouse has been gone for more than a year with the intention of leaving you forever.
    6. Living apart. You and your spouse have lived apart, without cohabitating, for at least three years.
    7. Confinement in a mental hospital. At the time of filing, your spouse has been confined to a mental hospital for at least three years without a prognosis of improvement.

2. Mandatory waiting period vs. reality. 

Texas family courts aren’t in a rush to finalize divorces. Expect to wait a minimum of 60 days from the date of filing for your divorce to be final. However, the average wait is six months to a year, depending on the complexity of the divorce and degree of conflict.

The only exception to the 60-day waiting period is one of two specific criteria involving domestic violence.

3. Legal separation? Not in Texas. 

In Texas, you’re either married, or you’re not. Or so says the law. That means that all assets and debts, whether accumulated while together or separated, are considered communal property at the time of divorce.

This is important to keep in mind if you’re thinking that a separation will give you time to think, experiment with singlehood, or side-step divorce.

You could end up liable for expenses your spouse accrues on a separate credit card, for example. You could also have to divide income and benefits you accumulate while “kind of” living on your own.

4. Alimony? Good luck.

One of the most important things you, as a woman, must know about divorce in Texas is that there is no court-ordered alimony. Texas courts call this “judicially imposed allowance,” and they don’t award it. What the courts refer to as “maintenance” comes with specific criteria.

Three examples that don’t involve the specific conditions of domestic violence include:

    1. You will not have enough property to provide for your minimal needs after the divorce. (Note: not “the lifestyle to which you are accustomed.”)
    2. You have been married 10 or more years and are unable to provide for your minimal needs. (This is particularly relevant to women who forfeited careers to care for children or elders.)
    3. You have a child that requires extensive supervision because of a physical or mental illness.

For women seeking structure, guidance, education, and support as they “contemplate” …. or begin the actual divorce/separation process, we invite you to consider Annie’s Group, our powerful, virtual, group coaching program for women only.

Annie’s Group provides support, education and a community of like-minded, resourceful women, so you feel less alone. Read more about Annie’s Group here. 


5. Custody arrangements.

The preferred and usual custodial arrangement in Texas is joint custody. The underlying desire is for children to have an equal relationship with both parents, even if they live primarily with one.

In a coparenting arrangement, both parents make decisions and have responsibility for the children. And the children live with each parent for at least 35% of the year.

While “joint managing conservatorship” is the court’s preference, the best interest of the children trumps all other considerations.

Finally, divorcing parents of minor children are required to complete a parenting class before a divorce is granted. Its intention is to help parents and children through the painful process of divorce. The class is available online.

6. Division of assets (and debts).

Texas is considered a “community property” state, which implies an equal division of both assets and debts.

However, special considerations can be taken into account by the judge. For example, the degree of disparity between income and earning potential can influence an unequal division.

Similarly, the physical capacity of both parties, nature of assets, and fault in the marriage’s breakup may be taken into consideration.

When it comes to the division of debt, it’s important to know that a divorce decree means nothing to creditors.

To assure that you aren’t left paying off mutual debts alone, it may be wise to divide responsibility for debts as part of the divorce.

Finally, it would be in your best interest to have a financial advisor or attorney go over your community assets with you. The timing of the acquisition of retirement benefits, for example, can determine what you are owed in the divorce.

There are a lot of things a woman must know about divorce in Texas before signing off on the next phase of her life.

 

Since 2012, smart women around the world have chosen SAS for Women to partner them through the emotional, financial, and oft times complicated experience of divorce and reinvention. SAS offers women six FREE months of email coaching, action plans, checklists and support strategies for you, and your future. Join our tribe and stay connected.

 

A woman thinking about asking for financial help with a divorce

How a Certified Divorce Financial Analyst Can Help with a Divorce

Dividing a house, retirement accounts, alimony, child support—all the financial issues that come up in a divorce can leave your head spinning. The process of going through a divorce is incredibly stressful, regardless, but if you’re not comfortable talking about money, facing the topic of splitting up your finances can be downright miserable. You may be wondering how to plan for your financial life after the divorce, how to divide your assets, who gets the primary residence, and how to negotiate spousal support. Having a financial professional on your team to help with a divorce can reduce your stress while allowing you to achieve the best possible financial outcome.

Getting financial help with a divorce is critical as studies have shown that women experience disproportionate losses in income as a result of divorce, increasing their risk of poverty.

When facing a divorce, a person’s first instinct is often to get an attorney involved. While there’s no substitute for sound legal advice, many of the decisions made in a divorce are financial in nature. Having support from someone well-versed in divorce financial planning and analysis (such as a Certified Divorce Financial Analyst) can save you a lot of frustration—it can also save you money on legal fees.

What is a Certified Divorce Financial Analyst?

A Certified Divorce Financial Analyst (CDFA) has extensive training in the financial issues of divorce. The credential is awarded by the Institute for Divorce Financial Analysts and requires extensive work experience and education. These professionals are trained to help you navigate any and all money issues that come up before, during, and after divorce. A CDFA can serve as a financial advocate for just you or as a neutral person who works with both you and your Ex. However, it’s important to remember a CDFA is a financial professional who can’t replace sound legal advice.

What does a Certified Divorce Financial Analyst do?

A CDFA is responsible for looking at your finances, considering the best way to divide assets, and helping you determine the short- and long-term implications of your divorce settlement. By doing so, a CDFA can help alleviate the fear of the unknown. She’ll prepare a financial plan for you based on various scenarios. Having that plan in place will offer you a great sense of confidence (or a reality check, if needed) as you face your financial future.

While every situation is different, the responsibilities of your CDFA may include some or all of the following.

Division of assets

The division of assets during a divorce is more than just a simple split down the middle. Many times, there’s no easy way to split an asset that both you and your Ex want. Your home, furniture, vehicles, among others, come with memories and security that neither of you may want to let go of.

In addition to those physical assets you have, there are financial assets that need to be divided, such as bank accounts, retirement accounts, and life insurance policies. Pensions are commonly the largest asset dealt with in a divorce. Any and all of the pension earned during the marriage is considered marital property and is considered divisible as part of the divorce settlement either by dividing the pension itself or offsetting the value with other assets.

A CDFA will sort out all the details and help you and your Ex determine the best ways to maximize your assets while minimizing the tax impact of your division.

Marital property

If you live in an equitable division state (41 of 50 states are), a couples’ marital assets (those accumulated during the marriage) will need to be divided equitably or fairly. In community property states, marital property is split 50/50. A CDFA can support you and your attorney by determining which items are marital assets and which ones are separate.


If you are wondering about your home and who gets it, you’ll want to read Should You Keep the House During the Divorce?


For example, any money contributed to a 401(k) during the marriage is considered marital property. However, if the account was started before the marriage, a portion of the account may be regarded as separate. The actual definition of what is considered separate property varies somewhat from state to state. Money and things you had before your marriage, gifts you’ve received over the years, and more can complicate an already stressful situation if you don’t have someone to help with a divorce and provide clear guidance on these issues.

Alimony (aka Spousal Support/Spousal Maintenance)

If your Ex provided the primary income, suddenly concerns of how to pay for the house, cover your bills, or whether you’ll have to get another job are at the forefront of your mind. While some states do provide a calculator to determine alimony that will be awarded to the lower income spouse, many do not. In fact, in many states, the issue of alimony is pretty gray.

Some of the factors that contribute to spousal support (depending on the state) include:

  • Your income
  • Health (emotional, physical, and mental)
  • Retirement benefits
  • Length of marriage
  • Childcare status
  • Education
  • Assets and liabilities

When you have a CDFA on your team to help with a divorce, she can do the calculations and give you confidence with projections for how much spousal support is needed compared to how much is available to be paid.

Tax implications of the divorce settlement

Any change in income or accumulation of significant assets can have tax implications as well. In the case of divorce, that’s definitely true. Going from two incomes to one, eliminating an income, or taking on the primary residence all have tax implications. A CDFA will walk you through those challenges so that there’s no guesswork when it comes to that first tax season on your own.

Additional tasks

Additionally, your CDFA will help with a divorce by providing analysis of the settlement, identifying if any information has not been disclosed, and pointing out areas of financial risk in the agreement. A CDFA can also guide you to make decisions that will help your credit score and not hurt it. By hiring a CDFA, you know that your entire financial situation has been evaluated, and you’ll walk away with a clear picture of what your financial future holds.

How is a CDFA paid?

In terms of cost, the fees for CDFA vary widely. Some offer services on an hourly basis, while others offer flat-fee packages. Hourly rates generally range from $150 to $500 per hour depending on the CDFA’s level of experience and the region of the country they work in. Flat fees are typically based on the financial complexity of the case and the extent of the work involved.

To find a CDFA near you, visit the Institute for Divorce Financial Analysts (IDFA) website. At the top of the screen, you’ll see a link to “Find a CDFA.” You can then search either by name or by zip code. Many CDFAs also offer virtual services if there is not one in your area.

Your Certified Divorce Analyst can make financial decisions easier

While CDFA professionals can help with a divorce at any point in the process, choosing to work with a CDFA before deciding how you will proceed makes good financial sense. Not only will it save you both time and money throughout the divorce process, but your CDFA will help you and your soon-to-be Ex work out a divorce settlement that is amicable and fair for both of you. Additionally, she will make the process easier to deal with so that you can focus on the things that matter most to you, whether that’s your kids, your family, or your well-being.

 

Leah Hadley is an experienced mediator, Accredited Financial Counselor, Certified Divorce Financial Analyst, and a Master Analyst in Financial Forensics. After going through her own divorce after ten years of marriage, her goal is to ease the stress of divorce by making the process as painless as possible for couples and individuals alike. When she’s not working, Leah loves spending time with her family, taking her kids on road trips, and volunteering with various organizations like the PTA, NAWBO and Girl Scouts. You can find out more about Leah and her services by visiting her website, Great Lakes Divorce Financial Services.

 

Beyonce in elegant black hat

What Women Should Know about High Net Worth Divorce

Very often in high net worth divorces, women are considered the less affluent partner. They may enjoy a very privileged and even enviable lifestyle, but because they are not the “breadwinner” or “rainmaker,” their own sense of power and independence may feel minimized, especially when it comes to divorce. Of course, the reality is that most of these women played a vital role as advisor to their husbands and often, mothers to their children. They might have financed his education, managed all the decisions around his career and their shared lifestyle, and actually have cultivated and nurtured the professional and social connections that helped them attain and secure their shared, current high net worth life. And yet, these same women may have no access to the cash or understand where the cash comes from. In a perverse reversal of privilege, they might even feel ashamed when considering what’s otherwise possible for their lives. They may feel trapped. While there are clearly many aspects–emotional, practical, socio-economic, historical, etc.–related to this scenario, this article will focus on the black and white legal aspects of today.

Understand that in order to successfully navigate a high net worth divorce, you will have to:

  1. Account for and value your assets (–items or resources that are convertible to cash)
  2. Determine whether or not your husband is hiding assets
  3. Calculate the amount of maintenance (alimony) you may be entitled to
  4. Analyze the impact of any pre-nuptial agreement you (may have) signed.

Although other factors may certainly come into play, this article will focus on these legal points as they are critical in almost all high net worth divorces.

Accounting for and valuing marital assets

During a divorce, you and your husband will have to declare your marital assets. The exception is where you waive your right to financial disclosure, which is usually not advisable. In New York, and many other states, marital assets are divided under the doctrine of “equitable distribution,” which means they will be distributed to you and your husband in a fair way (ideally), taking into account all of the circumstances of your marriage.

A pre-condition to dividing marital assets is that they be accounted for and valued. If you are not sure what marital property you own, you will most likely need the help of a matrimonial attorney who may use financial experts to investigate. For example, a forensic accountant may be able to find assets by tracing banking records, even if multiple accounts were used to buy marital assets.

Your assets will also have to be valued. In high net worth divorces, business valuation experts may be needed, as well as appraisers who specialize in valuing everything from real estate to exotic cars. Marital assets may even include airplanes, artwork, boats, and collectibles like coins and dollhouses!

Hidden assets

It is not unusual in a divorce for one spouse to conceal assets from the other. If your divorce goes through and your husband has concealed his assets, you will forfeit your right to them unless you can prove he did so and therefore the divorce was obtained fraudulently. While such cases exist, they are rare (remember, you have to prove the fraud). It is more common that a spouse who has hidden assets will get to keep them after the divorce. Obviously, this is a result to be avoided.

Some signs your husband may have concealed assets are that he never told you what he earned; made large purchases without saying where the money came from; and supported you in a high lifestyle without having the outward means to do so, or asked you to sign papers without explaining to you what they were for.

Maintenance

Maintenance is designed to provide the less-monied spouse with the means to support herself after the marriage in a way that does not seriously erode the pre-divorce standard of living. Interestingly, in high net worth divorce cases, it is not uncommon, if a large award of cash or assets is made to the wife, that she will not be awarded maintenance (the theory being that the award substitutes for it.) Similarly, there’s the reverse: if the wife does not receive a large award, maintenance may be awarded.

Pre-nuptial agreements

It is not uncommon in high net worth marriages for the husband and wife to have signed a pre-nuptial agreement. In most cases, the terms of the pre-nup will determine the outcome of the divorce as to financial matters. So, if you are facing a divorce and have a pre-nup, it is essential that you have it examined by a divorce attorney so you will understand what you will be entitled to in your divorce.

Conclusion

Preparation for a high net worth divorce is key. The earlier you get educated and understand these factors, the more likely it is that you will secure the kind of divorce the law entitles you to.

Read more from Divorce Attorney Daniel Stock:

6 Ways to Pay for a Divorce

Getting a Divorce with Children and Dealing with a Daddy-Come-Lately

 

Daniel H. Stock, PLLC, with offices located in New York City and Westchester, brings more than 25 years of legal experience to all issues associated with uncontested, collaborative, contested or high net worth divorce. He seeks to reach amicable agreements on matters such as child custody and visitation, child support and alimony, and property division. He favors the kind of outcome that benefits you and your children as you transition to a post-divorce future. However, when discussions are not productive, consensus is not possible and litigation is necessary, he is fully prepared to aggressively protect your rights in court. Make an appointment to speak with divorce lawyer Daniel H. Stock by using his contact form or by calling his firm at 475-232-4105.

Note from SAS: Find strong, wise counsel that supports you and your interests. Before getting fully educated on what your life and divorce choices are, however, do not adopt the knee-jerk reaction of “I’m going to take him to the cleaners!” For in the long term, as we have learned through our women-dedicated divorce consultancy, this approach is rarely clean. For more on this and what you most critically need in terms of legal support, financial support, AND emotional support to ensure your best divorce recovery – and avoid court, contact SAS for a free consultation.

 

 

Woman in a suit

Wait, What? Yep, Women Pay Alimony, Too

Is your soon-to-be ex-husband asking for alimony or spousal maintenance?

Actually, you are not alone, women pay alimony, too.  Official and current statistics don’t exist, but in my experience and in an informal survey of attorneys and mediators in my circle, it’s not only happening but in fact, women who will have to pay alimony is on the rise.  I see it in about ten percent of cases, which makes sense, as according to the Bureau of Labor Statistics, women are now the primary breadwinners in one-third of all marriages.

I find that while men aren’t happy to pay alimony, they aren’t exactly surprised either.  Women are shocked and furious.  Here is a sampling of the reactions I hear to the news:

“His attorney said they would ask for alimony.  Can they DO that?”

“I make more now, but he could make more money if he tried.  He’s just lazy.”

“Why should I pay him money to sit on his a**?!?”

Under what circumstances would you have to pay alimony?

If you make a lot more money than he does, and you’ve been married for more than 10 years, prepare yourself for the possibility that you will be paying him maintenance.  You might have been working harder all through the marriage, but unfortunately that’s not how it works.

What may seem like a horrible injustice is actually just (mostly) math

In New York state (as with many others), there are guidelines and a formula to follow.  A great tool to use to get a sense of things is to check out this online calculator.

However, that’s just a place to start. The courts do look at other factors when making a decision about support, including:

• the length of the marriage

• each spouse’s age and health status

• each spouse’s present and future earning capacity

• the need of one spouse to incur education or training expenses

• whether the spouse seeking maintenance is able to become self-supporting

• whether caring for children inhibited one spouse’s earning capacity

• equitable distribution of marital property, and

• the contributions that one spouse has made as a homemaker in order to help enhance the other spouse’s earning capacity.

It sounds fair if you aren’t living it.  What is not in the formula?

• If he cheated on you

• If you were a saver and he spent all your money

• If you already feel he’s been sponging off you for years

• If he’s underemployed or worse, unemployed and you still do more of the cooking and cleaning around the house.

Unfortunately, the “fairness” of it all can’t be quantified nor corrected by the courts. In trying to create an equitable system, it turns out that lazy husbands can look to you for alimony or maintenance during separation proceedings. The simple reality is, sometimes women pay alimony too.

What to do now

If you are unsure of how your divorce will affect you financially, help is available.

A Certified Divorce Financial Analyst (CDFA) can work with you to project the financial implications of your divorce, while your attorney focuses on the legal issues. Setting a realistic budget and understanding the tax and investment details before your divorce is finalized will allow you to start off on the right foot financially.

Sara Stanich is a Certified Financial Planner (CFP®) practitioner and Certified Divorce Financial Analyst (CDFA™) based in New York City. She specializes in helping parents understand their options and make informed decisions surrounding the financial aspects of divorce.  Learn more or schedule a free consultation at PowerOverDivorce.com.